Hi Anthony,
I loved your video setting up a practice in 7 days!! thank you. My question is, I am newly licensed and was offered a position at the site that i completed my intern hours at. As an intern, the owner paid $15/client while he was making $72, but I was an intern and need the hours so I had to do it. Now that I am licensed his split is 55/45 with me getting 55 and he gets the 45%. I feel i should do this for a little while, while I am trying to get my own practice going. The problem is (really what my question is) in the employee agreement he gave me to sign it states that I can not work within a 50 mile radius of his office. I live in the area and want to of course set up a space close to home and was hoping that I could work for him a few days per week while starting my own practice. What are your thoughts? Thank you so much, MaryAnn.
————————-
MaryAn,
Great question!
I’m going to ignore the issues of compensation for now, because it’s not really relevant to your question about the non-compete. I’m starting to answer your question by restating it here:
“The problem is in the employee agreement he gave me to sign it states that I cannot work within a 50-mile radius of his office. I live in the area and want to of course set up a space close to home and was hoping that I could work for him a few days per week while starting my own practice.”
Now let’s start from the beginning and get down to business: Non-competes are a hot topic among therapists. In some states they’re allowed, and in some states they’re not. In some states, whether or not a non-compete is allowed depends on the actual license you hold. For example, in Massachusetts, an LICSW cannot be bound by a non-compete, while an LMHC can—even if both therapists were hired to do the same exact job!
In addition, non-competes (typically) need to be reasonable, and many states that do allow for them, if the issue is brought to court, if they’re not deemed reasonable will be completely thrown out—not just edited.
For example, if a non-compete says that one cannot work for another counseling business, in any capacity, such might be deemed to broad (you can’t even work as a receptionist?) and therefore could be entirely thrown out. Or, distance, if too far, could also be deemed unreasonable, and could result in a non-compete being thrown out.
Some states, on the other hand are “big boy” states which means if you sign it, you need to stand by your word right from the start.
Okay, so there’s some general legal info (that I do not warrant. I’m not an attorney. I know just enough to be dangerous).
Here’s what I think is the best way to handle your situation.
Don’t sign an agreement you don’t intend to honor from the start, even if you think you can get away with breaking it. Doing so is not not honorable. It’s bad business and not worth the investment.
In this case, the owner wants you to start by signing a 50 mile non-compete. Frankly, I think that’s craziness. But that’s my opinion.
If I were in your shoes, and I wanted to see some clients with this practice while planning or starting to make an investment into my own therapy practice down the road, I’d come clean and tell the owner.
- Maybe he will create a promotion program to entice you to fill a number of jobs at his practice.
- Maybe he’ll agree to waive the non-compete after 24 months of full-time service.
- Maybe he’ll tell you he doesn’t want to onboard someone who’s already planning to leave to open her own psychotherapy practice.
While the last answer isn’t the ideal outcome for you, that’s really the best and most honest way to go about negotiating the terms of your employment.
I hope this helps!
Let’s keep in touch! Sign up to receive our newsletter:
Anthony Centore
The other nuance is whether this agreement was an employee agreement or an independent contractor agreement. From my research, non-competes are unenforceable if the position is an independent contractor, since an independent contractor, by its nature, is one where the professional would have multiple jobs.
Neil Mcnerney can you direct me to that information. I am an LCSW in the state of Illinois. I signed an agreement. How ever, I am a contractor. there are no benefits and I pay self employment tax. The problem is the fee split. the billing company get 8 percent, They get 31 percent and I get 61 percent. I am not making much. I do not get paid for phone calls meetings, telephones with patient families, writing notes, billing paperwork. The group also goes to peoples homes. recently they wanted me to take a case and drive one hour to a persons home see them for an hour and then leave. The owner told the referral source that someone would do it. she is not my supervisor, she and the office person started to contact me. there are a series of texts in which I am saying maybe someone else could do that. I get No we want to do that. The owner said that she would do it to save face. She said she had to think about the company, privately owned for profit. Next, they run adds looking for people all the time. someone else expressed interest. The contract says all my patients are mine. However, she decided to give away 8 or 9 of my patients or 5 to 6 billed hours to the new person. I would go to another facility and start again. With no pay I would meet with 19 different people, explain services and see if they wanted services . I only gt paid for what can be billed for. I can also only see people that agree and want service. The next issue was the person who went to this facility did not want to give up the facility for another 3 or 4 weeks. I would have a gap in which I lost 20% of my income waiting for hi to transition. I mentioned this when we met. She just kept repeating herself. It was so frustrating .I had written to her and explained my bills that I was eating cold cereal often. When I started I lost money. I was to start and they delayed the start time, then I got a few facilities at a time. I finally started seeing people. I had to wait and not get paid for 4 to 8 weeks until the insurance billed. so I used our savings. She than said that I could kept the facility and they would be terminating the contract. She actually told the new person that I would not give up the clients so they terminated the contract. She thinks I can not work in the start of Illinois seeing people in nursing homes for a year. However, I have only worked or been with them for less then 6 months before they got rid of the contract. If you average my earnings included the non billed time and self employment tax its 750 a week. Its about 900 or 980 if you do not include self employment tax. I have going into nursing homes before being hired for them. I learned nothing. I know nothing about the business. Infect an insurance company asked me for the company address I did not know it. They are an LLC. more alarming one person used to work for the nursing home group we go into. she said her friend is now over at least three of them and going to give use more referrals. When speaking to them and in the conversation she terminated the contract she said they have lots of referrals in private practice you will only get like one. The contract says I am paying the 31% for office space, but the company has no office. In a meeting with a facility the business person said the contract might say something about an office my name does not have to be on it. They maybe paying the facilities for office space. There is no office space. Only at one home do I sue a space with stuff put in it and broken blinds. It more like storage. One I can sometimes use a conference room. Otherwise there is no office. She tried to get rid of me that day but I stayed 30 days seeing people and transitioning them. some people are going to no one.